News

Metronet in cash plea

SHAREHOLDERS in Metronet, the company that maintains two-thirds of the London Underground network, are being pressed to inject fresh cash after banks blocked access to its loan facilities.

The impasse is the result of large cost overruns - likely to reach £750m within the next few years - on Metronet's Tube contracts.

The extra spending has been the subject of a protracted row between Metronet and Ken Livingstone, the London mayor, and is to be the subject of a regulatory inquiry to determine who should foot the bill.

But the overruns are also understood to have pushed Metronet over cost thresholds included in its loan agreements.

The banks - led by the European Investment Bank, which has put up £600m of the £1.6 billion loan facility - granted a six-month waiver last September to allow Metronet to continue to draw funds.

Another waiver request has been declined. The banks are said to be demanding